Whilst many organisations such as Anheuser-Busch, Carrefour, Coca-Cola, GE, GM, Groupe Danone, Motorola, P&G, SABMiller, Siemens, Volkswagen and Walmart have been in China many years, and established dominant positions there are still enormous opportunities.
Firstly China has a huge population which increasingly has more disposable income.
Secondly most foreign executives concentrate on the major cities and eastern seaboard and regional governments are offering large incentives to new ventures.
Thirdly the Chinese Government is open to proposals that bring new technologies, capabilities and business models to the country.
Opportunities are particularly good in areas such as distribution & logistics, financial services, media & retailing.
In 1998 a US auto manufacturer sourced 62% of product from US/Canadian companies and only 4% from Asian (mainly Chinese) organisations. By 2002 this was about equal at 30% each. It is predicted that by 2008 auto and industrial product companies will more than double their percentage of spending on components and materials in low-cost countries.
James Mayfield, a commercial officer for the U.S. Commercial Services, a part of the Department of Commerce, assists small- to medium-sized companies in San Francisco interested in taking advantage of those opportunities. The San Francisco Examiner recently interviewed James.
“Where are the growth areas for San Francisco firms doing business with China? Anecdotally, I get the sense there is a lot of action in the technology fields. Obviously, Silicon Valley, and our proximity and ties to Asia , are a big part of that. Also, China is opening up a lot of its services markets, like banking and financial sectors, and that will stimulate some new opportunities for Bay Area companies that offer very specialised services that China will need as they open up their markets.
Another area that impacts San Francisco is China’s construction boom, which is slowing down a little in the last six months, but for the last several years the country has been building like crazy. That has benefited architects — San Francisco has world-renowned architects, engineering companies, urban planners, and designers. I know many of them have been able to tap into opportunities in China .”
